Question

The following financial statements and additional information are reported.

IKIBAN INC. Comparative Balance Sheets June 30, 2018 and 2017
	2018				2017
Assets
Cash	$	77,300			$	61,000
Accounts receivable, net		90,500				68,000
Inventory		80,800				112,000
Prepaid expenses		6,100				8,800
Total current assets		254,700				249,800
Equipment		141,000				132,000
Accum. depreciation—Equipment		(35,500	)			(17,500	)
Total assets	$	360,200			$	364,300
Liabilities and Equity
Accounts payable	$	42,000			$	55,500
Wages payable		7,700				18,400
Income taxes payable		5,100				7,200
Total current liabilities		54,800				81,100
Notes payable (long term)		47,000				77,000
Total liabilities		101,800				158,100
Equity
Common stock, $5 par value		254,000				177,000
Retained earnings		4,400				29,200
Total liabilities and equity	$	360,200			$	364,300

IKIBAN INC. Income Statement For Year Ended June 30, 2018
Sales				$	763,000
Cost of goods sold					428,000
Gross profit					335,000
Operating expenses
Depreciation expense	$	75,600
Other expenses		84,000
Total operating expenses					159,600
					175,400
Other gains (losses)
Gain on sale of equipment					3,700
Income before taxes					179,100
Income taxes expense					45,590
Net income				$	133,510

Additional Information

1. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash.
2. The only changes affecting retained earnings are net income and cash dividends paid.
3. New equipment is acquired for $74,600 cash.
4. Received cash for the sale of equipment that had cost $65,600, yielding a $3,700 gain.
5. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement.
6. All purchases and sales of inventory are on credit.

Answer 1

Answer-

IKIBAN INC.
STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)
FOR THE YEAR ENDED 30 JUNE,2019
Particulars		Amount
		$
Cash flow from operating activities
Net Income		133510
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation		75600
Gain on sale of equipment		-3700
Change in operating assets & liabilities
Increase in accounts receivable		-22500
Decrease in inventory		31200
Decrease in prepaid expenses		2700
Decrease in accounts payable		-13500
Decrease in wages payable		-10700
Decrease in income taxes payable		-2100
Net cash flow from operating activities (a)		190510
Cash Flow from Investing activities
New equipment purchased		-74600
Equipment sold		11700
Net cash Flow from Investing activities (b)		-62900
Cash Flow from Financing activities
Cash dividends paid	($29200+$133510-$4400)	-158310
Common stock issued		77000
Notes payable paid		-30000
Net cash Flow from Financing activities (c)		-111310
Net Change in cash c=a+b+c		16300
Beginning cash balance		61000
Closing cash balance		77300